Fno Data Sheet - 02-08-11

Another Bear Day. FII sold contracts in decent amount. Price fall along with OI increase indicates shorts are in to the system. PCR is back to 0.91 - the threshold. OI increased by 8L contracts -coupled with price fall indicating shorts are entering the system.

This series is 3 days old. I tried to look into the series as a whole and found some interesting observations. In these 3 trading days, Nifty Future OI has increased by 20L contracts - for a fall of 30 points - and the FII stake in this is just 38K contracts. It indicates they have a leverage of 500 times. :). This data is an important reference. The difference between the highest and the lowest point in the series is also just 100 points.

Considering the bearish atmosphere surrounding and 30 point price fall, it is reasonable to assume that shorts are built into the system. The low PCR also suggests the same. As marked in yesterday observation also, FII have been short from a much higher level - around 5650-5680. Even on the equity front also, there has not been major volumes - the sell/buy look more for index management rather than any serious sell-off. Another important point to remember is Desi MO is at -58 - the lower end of the range.

Considering these, I do not consider new shorts rewarding enough. Probably a panic bottom in the next 2 days and a decent rally might be the way which causes maximum pain to maximum participants. Let us look forward.

You can look at the data sheet here